Implementing Policy

Question 1

What is fiscal policy?

Answer 1

Influencing the level of economic activity through manipulation of government income expenditure

Question 2

What is the budget?

Answer 2

Outlines spending and tax changes und canbe balanced, in a deficit or surplus

Question 3

What is a tax?

Answer 3

A compulsory contribution to state revenue levied by the government on worker’s income and business profits or added to cost of some goods, services and transactions

Question 4

Why is tax crucial to fiscal policy

Question 5

What are the four cannons of taxation?

Answer 5

1) equity
2) certainty
3) convenience
4) economy

Question 6

What is equity as a cannon of taxation

Answer 6

The taxes people or organisations have to pay should be proportional to their income
- “ability-to-pay principle” the more you earn the higher your taxes should be